UnitedHealth’s Optum to buy Steward’s physician group, adding 1,700 more doctors

Optum, a business unit of UnitedHealth Group, has agreed to purchase Steward Health Care’s struggling physician group. The group, Stewardship Health, spans nine states and includes primary care and other clinicians in addition to a physician contracting network.

The acquisition will further expand the size of Optum, which already has more than 90,000 employed or affiliated physicians and another 40,000 advanced practice clinicians serving tens of millions of people. The Massachusetts’ Health Policy Commission (HPC) has 30 days to review the deal or request more information from the companies, which said the sale could close during this year’s second quarter.

“This is a significant proposed change involving two large medical providers, both in Massachusetts and nationally, with important implications for the delivery and cost of health care across Massachusetts,” said David Seltz, executive director of the commission. “Details of the proposal will be reviewed by the HPC to examine potential impacts on health-care costs, quality, access and equity. The sale cannot be completed until after the HPC’s review and any concurrent review by state or federal antitrust authorities.”

Steward, which employs 1,700 physicians and is based in Dallas, operates several Massachusetts hospitals that are at risk of closure. This had led to demands by government officials for Steward to exit the state without interrupting care services or quality. Steward leaders said the company will sell its physician group along with other nonessential assets to “reset its operations and address vendor obligations.”

However, Democratic Sens. Elizabeth Warren and Edward Markey of Massachusetts have expressed concerns about the transaction.

“My top priority is ensuring Steward’s Massachusetts hospitals remain open,” Warren said. “But Steward executives have no credibility, and I am concerned that this sale will not benefit patients or health-care workers, or guarantee the survival of these facilities. It would be a terrible mistake for Steward to be allowed to walk away while looting Massachusetts hospitals one more time.”

She also is concerned about the size of the Optum physician group. “Optum, a UnitedHealth Group subsidiary, is already the largest employer of physicians in the country, controlling over 10% of American doctors, which means this deal raises significant antitrust concerns in Massachusetts and nationally,” she said.

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Optum added nearly 20,000 physicians in 2023, according to Dr. Amar Desai, the company’s CEO. It is the largest employer of physicians in the United States and has acquired several practices over the past year. Optum has more than 4 million patients in fully accountable care arrangements, which is expected to grow to five million by the end of 2024, Dr. Desai said.

“As a physician, I’m particularly excited that we are becoming the practice and partner of choice in the marketplace,” he said. “That is because we are driving quality, standardizing technology and clinical systems, and most importantly, strengthening our relationships with patients and providers.”